Identifying talent and potential in current and prospective staff is key to ensuring your firm is fit for the future, says Dr Amanda Potter. But how can you design a process that really works for your firm?

Amanda Potter

Every law firm leader knows that the legal sector and the wider business climate are undergoing massive change, with the pace only set to increase. We face rapid economic developments, globalisation and unprecedented political uncertainty, and we are on the brink of a technological revolution, where innovations, including artificial intelligence and machine learning, will alter the way we live and work.

To prepare for a new business landscape, law firms need to ensure they identify, retain and develop people with the best potential – those who are most fit for the future.

Meanwhile, the legal industry continues to increase its size, complexity and global reach, standards keep improving, and the business environment becomes more competitive. This increased competition places even greater emphasis on law firms’ greatest assets: their most talented people. It is the firms which identify, retain and develop their most talented people which will be the most successful, through their drive for innovation, disruption and entrepreneurship.

Potential - man in suit standing at edge of spotlight


It is now more important than ever to fit the right people into the right roles, with the appropriate strengths to succeed. To continue to push the boundaries of innovation, to remain commercial yet attractive to customers, firms will need to ensure their people not only are working towards the same agenda, but also have the same interests at heart.

But how can law firms assess current and prospective staff for this mixture of values, strengths and potential?

Rigorous, objective assessment for selection, retention and development are the key. We already know this process decreases costs from bad hires, increases productivity, and improves revenue potential. According to a 2012 study by the Centre for American Progress on the cost of employee turnover, replacing an individual at a senior or executive level costs up to 213% of annual salary.

But with the abundance of online assessment tools available, it is challenging to select the right process to meet your business requirements. This article offers some tips for success to help you identify talented people with potential.

1. Understand talent and potential

Talent and potential are not the same thing. To have talent or to be talented is about having core strengths and being unique. Everyone has strengths and is talented in some way. Assessing for talent means looking at what an individual enjoys, practises and becomes great at.

Potential is about fit with the future goals and strategy of the organisation. This means that a person can be talented but not have potential in your firm. Employees who have potential possess the right combination of values, skills and capability required to help deliver the future goals and strategy of the organisation. In other words, they ‘fit’ with these requirements. Like anyone else, they will be talented and have strengths, but more importantly, they will have the right combination of strengths to help the business achieve its aspirations. Assessing for potential will identify whether the individual has the right values, strengths, aspirations and capabilities to achieve success.

2. Create a multi-faceted model of potential

Understanding, defining and assessing how an individual is talented and the degree to which they have potential is key to business success. But what model can you use to achieve this effectively?

For years, we have debated the role of competencies (and over the last 10 years, capabilities) in assessment. They are great because they are anchored in the future strategy of the organisation and describe how people should behave. However, they do not consider what energises people (strengths); what is important to people (values); their motivations, aspirations, or engagement; or their emotional, social or cognitive intelligence. This means that competencies or capabilities are a great starting point for assessing talent or potential, but they are not enough.

Before you start trying to identify potential in your business, you need to understand the macro environment in which the organisation is operating. What challenges is the business facing, and how will individuals need to operate as a result?

Next, use a model which goes beyond competencies, focusing on behaviours, knowledge and skills. proposes a talent-and-potential equation which takes a multi-faceted definition of potential, as follows:

  • behaviours
  • expertise
  • strengths
  • tenets (values)
  • aspirations
  • intelligence.

Once you have defined your model of potential, you need to articulate what ‘great’ looks like under each of the categories. For example, if you identified the value of “entrepreneurial” as being critical for success, what does this look like and how do you know if a candidate or employee is living by this value or not? You need to do this for each of the criteria under the equation to make sure that the elements are observable and measurable.

3. Sense-check your model against your strategy

Once you have identified your model of potential, the next step is to check that it aligns with your business strategy. Each of the elements of the potential model should articulate what people need to do in order to deliver the plan and achieve the goals of the business – otherwise they are irrelevant.

4. Build a talent process that assesses the elements of potential

Many of the leading test publishers have correlated indicators of potential with their scales of personality, and use this to predict an individual’s general level of potential. These can be useful, but they do not directly link to the firm’s competencies or the model of potential being assessed, and therefore do not give an indication of an individual’s true ‘fit’ with future requirements. We have seen our clients overly rely on this potential indication and use it to rank their candidates and employees. This is particularly a problem when the question “potential for what?” has not been answered by generic personality questionnaires.

To improve the validity of your talent process, identify or design tools that directly measure the agreed elements of potential. You can do this by designing your interview, case study or exercise materials to directly draw out and measure the criteria in the model. You can also buy in and use questionnaires that are directly designed to assess the elements of the equation, such as emotional intelligence, strengths or values. Three of the tools I would recommend for this are the PSI emotional intelligence profile, the strengths questionnaire and the culture fit questionnaires.

5. Refocus on specific critical strengths

A common mistake is to think that ‘average’ is a great starting point for assessing and identifying talent. For years, employers have been using a ‘3’ rating for all areas as a cut-off when conducting assessments, on a five-point rating scale. In other words, is the candidate at least average across all areas?

If, however, you want to hire outstanding people with specific critical strengths, then you need to be prepared for them to also have some gaps, or allowable weaknesses. Average is not the best starting point.

6. Look ahead as well as behind

Future performance is best predicted by someone’s emotional and cognitive intelligence, and their strengths, values, skills and knowledge. But this does not mean past performance should not be taken into account; conducting a competency interview is still a useful part of an assessment solution.

7. Benchmark your talent externally

Work with your test publishers and consulting partners to understand how your talented people compare to high-potential talent in competing organisations. What are the risks, the gaps and the challenges you need to consider for the future?

8. Focus on development

Only 20% of organisations articulate their talent strategy to their employees, and most law firms still have talent discussions behind closed doors, with many people not knowing where they fall in terms of performance (such as on the 9-Box model) or what they need to do to develop. This needs to change; high-potential individuals want to know where they stand, that they will be invested in, and that they have opportunities to develop, learn and grow.

In order to retain people with the highest potential, law firms need to articulate what they intend to do to support them with their careers, development and future goals. They need to give their employees the accountability to make a difference.

These eight tips have been offered to help HR and talent professionals articulate and understand the foundations that need to be in place when identifying and retaining talent. The impact of having a clearly articulated talent approach that clearly links to the business strategy is significant. It positively impacts on a firm’s culture by demonstrating to employees that the organisation values, invests in and develops people with potential, who fit the organisation’s current and future requirements, and who are talented. It also signals to those employees what is and is not important, and how they should behave in order to succeed.